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Taken for Granted? Effects of Loan-Reduction Initiatives on Student Borrowing, Admission Metrics, and Campus Diversity

Author

Listed:
  • Christopher Bennett

    (Vanderbilt University)

  • Brent Evans

    (Vanderbilt University)

  • Christopher Marsicano

    (Davidson College)

Abstract

In recent decades, several dozen colleges and universities have instituted loan-reduction initiatives (LRIs), such as “no-loan” programs. Institutions frequently cast such initiatives as efforts to increase socioeconomic diversity on campus. Using a difference-in-differences analytic strategy with national institution-level data, we examine the effect of LRI adoption at 54 institutions on three sets of outcomes: student borrowing, admission metrics, and campus diversity. Our analysis suggests LRIs decreased institution-level borrowing rates at private institutions, with no detected change at public institutions. Consistent with stated program goals, LRI adoption increased the number of Pell Grant recipients at both public and private institutions. However, adopting LRIs at public institutions reduced racial/ethnic diversity, suggesting possible trade-offs for LRI adoption in terms of student body diversity.

Suggested Citation

  • Christopher Bennett & Brent Evans & Christopher Marsicano, 2021. "Taken for Granted? Effects of Loan-Reduction Initiatives on Student Borrowing, Admission Metrics, and Campus Diversity," Research in Higher Education, Springer;Association for Institutional Research, vol. 62(5), pages 569-599, August.
    • Handle: RePEc:spr:reihed:v:62:y:2021:i:5:d:10.1007_s11162-020-09615-7
    DOI: 10.1007/s11162-020-09615-7
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    More about this item

    Keywords

    Postsecondary education; Student loans; No-loan programs; Socioeconomic diversity; Racial diversity;
    All these keywords.

    JEL classification:

    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid

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